Perseverance and Raising Capital
The following post is from Michael Vega-Sanz ’19, co-founder of Lula, a fall 2016 hatchery business.
“I’m convinced that about half of what separates the successful entrepreneurs from the non-successful ones is pure perseverance.”
– Steve Jobs, Co-Founder of Apple
When word got around that my brother and I raised $200,000 in a four week span for our startup, Lula, the number one comment made was “How?” We are two, twenty year old students with limited experience, and for the most part, simply had an idea on paper (although we did have an experienced development and legal team). We did not raise any capital from family, and over the course of our life time, our contact with the initial investors was either non-existent, meaning we had never met, or extremely limited. These circumstances further beg the question, “How?”
I could write articles on how investors would like to see a projected P&L statement, balance sheet, and cash flow statements. I could write an article on how you may want to offer your initial investors a convertible note, using that as instrument to further entice them. I can even offer advice on the perfect pitch, what to say and how to prepare your pitch deck. However, although these are all vital when trying to raise capital, they are not the most important. The most important factor when raising capital or starting your own company is perseverance.
Before getting our first dollar from an investor, my brother and I were rejected twenty-one times. Each rejection stung a bit, but rather than giving up, we kept persisting. Furthermore, my brother and I never got upset, nor did we ever hold grudges towards an investor. Instead, we always asked investors, “Why?” Not in an ignorant manner, but because we genuinely wanted to learn from the experience to ensure that we were more prepared for the next time we pitched our idea to an investor. Lastly, we never lost hope. We always had a sense of hope that the next meeting would surely be with our first investor.
After a failed spray and pray campaign, dozens of emails, several meetings, and twenty-one rejections, my brother and I finally got our first investment. The following day, we got our second investor. The feeling of getting your first investment is like no other, and it truly makes the journey much more satisfying. It gives you and your team a sense of validation, providing that sense of motivation to keep on pursuing.
Ultimately, there is so much more to raising capital than just being persistent. Yes, one must have a valid idea with a legitimate market, and room to scale. However, if one does not have the ability to accept criticism, understand that not everyone will believe in you or your idea, and continue to persevere in the face of adversity and doubt, then you may not be ready for such a task.